Supplementary information:
Securities investment fund refers to a collective investment method that raises funds through the sale of fund shares, is managed by the fund custodian and managed and operated by the fund manager, and invests in securities in the form of asset portfolio to safeguard the interests of fund share holders.
1. Enjoy the income * * *: that is, the securities investment fund is a collection of funds by many investors and entrusts professional fund managers to invest by purchasing shares. Fund managers only charge a certain percentage of management fees, and all profits are distributed by investors according to the proportion of capital contribution.
2. Risk * * * burden: the investment target of securities investment funds is equity products with high risk characteristics, and there is a risk of loss while making profits. In the event of losses, the fund manager will not be liable, and all losses will be limited liability by the investors in proportion to their capital contribution.
Extended data:
Potential risks of the fund:
I. Assessing the risk of holding positions
1, investment style risk
Morningstar investment style box is a good tool to preliminarily judge fund risk. In the long run, the volatility of large-cap value stock funds located in the upper left corner of the style box is lower than that of small-cap growth stocks in the lower right corner, and the volatility is on the rise from upper left to lower right. This is because, other things being equal, small-cap stocks are more volatile than large-cap stocks.
2. Industry risks
Over-concentrated industry allocation may make the fund obtain excess returns in a certain period of time, but when the industry valuation is too high, the net value of the fund may fall sharply. The industry weight of the fund can be compared with other similar funds or large-cap index funds to confirm whether the fund is "excessive" in some industries. Of course, this does not mean that investors should not hold a heavy position in a favorite industry, but should avoid holding too many different funds in the same industry, so that the portfolio will lose its risk diversification function.
3. Risk of a single company
Statistically speaking, the risk of concentrating on funds with fewer companies is necessarily higher than that of diversifying portfolios. Of course, it depends on the market. When there are few good targets in the market, fund managers will increase the concentration of positions for the purpose of reducing risks and improving investment and research efficiency.
Second, measure performance risk.
1, performance fluctuation risk
The above fundamental analysis can judge the main source of a fund's risk, but there are also great individual differences in fund risk. Past performance fluctuation can reflect this difference, and standard deviation is the most commonly used index to measure fund performance fluctuation. Comparing the standard deviation of the fund with the average level of the same kind or the standard deviation of the market index, we can see how the fund controls the performance fluctuation. Funds with large fluctuations in performance make investors take more risks, so they should have higher returns to compensate for the risks.
2. Maximum retracement risk
Generally speaking, investors' funds are not completely unnecessary, so it is very important to set loss expectations. If the historical worst return of the fund exceeds the loss expectation in a certain period of time, it means that when the fund retreats again in the future, investors under financial pressure will have to redeem the fund, resulting in permanent losses.